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58 Fair Empl - Prac.cas. (Bna) 1649, 58 Empl. Prac. Dec. P 41,505 Leonard C. Chaput v. Unisys Corporation, 964 F.2d 1299, 2d Cir. (1992)
58 Fair Empl - Prac.cas. (Bna) 1649, 58 Empl. Prac. Dec. P 41,505 Leonard C. Chaput v. Unisys Corporation, 964 F.2d 1299, 2d Cir. (1992)
2d 1299
Approximately one year after losing his job at Burroughs Corporation, Leonard
C. Chaput brought an action against Burroughs1 alleging a violation of the Age
Discrimination in Employment Act, 29 U.S.C. 621 et seq. (1988)
("ADEA"). Burroughs raised as a defense a release from liability signed by
Chaput. Burroughs thereafter moved for summary judgment, arguing, inter alia,
that, whether or not the release had been signed knowingly and voluntarily,
Chaput had ratified the release by accepting and retaining valuable
consideration. This motion was denied. Burroughs then moved for
reconsideration. Judge Telesca denied this motion as well. Burroughs now
appeals from the denial of reconsideration. We lack jurisdiction and dismiss the
appeal.
BACKGROUND
Viewing the record in the light most favorable to Chaput, the party opposing
the motion for summary judgment, the facts are as follows. Chaput was hired
by Burroughs in 1957. He received a number of promotions over the years, and
by September 1983 was the Controller of Burroughs' Office Supply Division. In
February 1985, Chaput was relieved of his duties as Controller and transferred
to the Business Forms Division of Burroughs.
5 this letter reflects our understandings and you agree to accept the provisions set
If
forth above, you do release and forever discharge the Burroughs Corporation ... from
all claims and from all liabilities of any kind or nature whatsoever ...
6
You further declare ... that this is a full, complete, and final release.
At a later meeting with Scarpelli, Chaput told Scarpelli that there were
omissions in the letter. In particular, the letter did not state whether Chaput was
entitled to accumulated vacation time or to his stock options. Scarpelli added
handwritten notes to the letter to satisfy Chaput's concerns. Chaput hesitated
and, he contends, signed the letter only after Scarpelli assured him that it "didn't
mean anything" and that "everybody signed it." Finally, Chaput testified that he
did not know what his entitlements were.
Chaput performed no services for Burroughs after July 23, 1985. However,
pursuant to the terms of the letter, he remained on Burroughs' active payroll
until October 11, 1985. At that time, he began to receive his accumulated
vacation time and extended lay-off benefits, as the letter also provided.
Additionally, Chaput received outplacement assistance and uncontested
On October 30, 1985, Chaput filed a complaint with the Equal Employment
Opportunity Commission ("EEOC") accusing Burroughs of age discrimination.
On November 5, Burroughs offered to extend Chaput's status as an active
employee if he signed another release that explicitly stated that the extension
and release were a quid pro quo. Chaput declined and, in August 1986,
commenced the instant action.
10
11
12
Burroughs relies on Janneh v. GAF Corporation, 887 F.2d 432 (2d Cir.1989),
cert. denied, --- U.S. ----, 111 S.Ct. 177, 112 L.Ed.2d 141 (1990), and Grillet v.
Sears, Roebuck & Co., 927 F.2d 217 (5th Cir.1991), in arguing that the
collateral order doctrine applies in the instant matter.
13
In Janneh, the plaintiff had brought suit against his employer, GAF
Corporation, alleging discrimination in violation of Title VII. Over four years
later, on the advice of counsel, Janneh agreed to settle the case. At a subsequent
status conference, Janneh repudiated the settlement, arguing that he had been
15
Under Janneh and Grillet, we may have jurisdiction on the ground that a release
from liability protects the released party from the distractions and expenses of a
trial as well as from further monetary liability. This theory is analogous to that
applied to claims of double jeopardy or qualified immunity. See Caribbean
Trading v. Nigerian Nat. Petroleum, 948 F.2d 111, 114 (2d Cir.1991), cert.
denied, --- U.S. ----, 112 S.Ct. 1941, 118 L.Ed.2d 547 (1992). In those cases,
the claim asserted is not only a defense to liability but also an immunity from
trial. Interlocutory appeals are allowed because a denial of such a claim
disposes of the asserted immunity from trial, is separate from the merits, and is
effectively unreviewable at a later stage. E.g., Mitchell v. Forsyth, 472 U.S.
511, 524-30, 105 S.Ct. 2806, 2814-18, 86 L.Ed.2d 411 (1985) (qualified
immunity). Janneh and Grillet differ in that the former involved a settlement of
ongoing litigation whereas the latter involved a general release by a terminated
employee. However, these are not distinguishing features because in each case
it can be said that the employer was bargaining to avoid the distractions and
costs of trial as well as further liability from damages.
16
17
A release is not effective unless the party giving the release receives something
of value to which the party was not otherwise entitled. See Weiner v. McGrawHill, 57 N.Y.2d 458, 457 N.Y.S.2d 193, 196, 443 N.E.2d 441, 444 (1982).
Chaput argues that he did not receive valid consideration for signing the release
and that, without consideration, there is no contract that could have been
ratified. Indeed, if there was no consideration, such consideration could be
neither returned nor retained. Burroughs, on the other hand, contends that
because Chaput accepted consideration and failed to tender it, he has ratified
the release.
18
Burroughs states that Chaput was entitled to the benefits listed in the letter
except for the provision of out-placement assistance and twelve extra weeks on
the payroll as an employee from July 23 to October 11, 1985. To establish that
these latter benefits were not entitlements, Burroughs relies upon the testimony
of two of its employees, Scarpelli and Paul Titzler and upon the Burroughs
Personnel Policies & Practices Manual ("Manual").
19
Although the matter is close, the evidence in the record is sufficient to allow a
trier of fact to find that Chaput did not receive valid consideration. Titzler's
testimony as to whether all the enumerated benefits were entitlements was
inconsistent in that he at one point stated that all of the benefits in the letter
containing the release were "standard." Chaput testified at his deposition that
no one identified for him benefits to which he was entitled whether or not he
signed a release or benefits that were available only if he signed the release. In
fact, Scarpelli's initial proposal failed to include benefits to which he was
entitled. Chaput stated that he was also told by Scarpelli that everybody signed
a similar form, that signing it was just a formality, and that the release meant
nothing. If Chaput's testimony were credited by a trier, Scarpelli's statement
might well be interpreted to mean that no quid pro quo was involved.
20
21
23
One difficulty with Burroughs' position is that on this record a trier could find
that the Manual was not the exclusive source of standard termination benefits.
There is evidence of other benefits available, or arguably so, on an informal
basis, such as outplacement assistance. In addition, the letter containing the
release requires a lump sum payment of unpaid extended lay-off benefits if
Chaput were to find other employment. Burroughs does not claim that this is a
non-standard entitlement, yet the Manual contains no provision for such lump
sum payments.
24
Because there is a dispute of material fact concerning the validity of the release,
we conclude that Judge Telesca's denial of summary judgment is not an
appealable decision under the collateral order doctrine. We dismiss the appeal
for lack of appellate jurisdiction. In view of our disposition of this appeal, we
do not address issues concerning whether the release was signed knowingly or
whether it was ratified by Chaput's conduct.